HP Joins the Athlon Pile-On
R. Krause - January 31st, 2000
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Event Summary
January 21, 2000 [PC Week Online]
While Gateway Inc.'s recent rollout of new PCs powered by Advanced Micro Devices Inc.'s Athlon processor drew widespread attention, Hewlett-Packard Co. was quietly stocking the shelves at Sam's Club discount stores with two new desktops that mark its first use of the chip.
HP's addition of the Athlon to its desktop systems means AMD, of Sunnyvale, Calif., now has its top processor, and the chief rival to Intel Corp.'s Pentium III, featured in systems made by four of the five largest PC makers in the United States. The lone holdout remains Dell Computer Corp.
"Certainly we're pleased that interest in Athlon continues to grow and we're attracting more strategic customers," said AMD spokesman Drew Prairie. "It signals a continuing trend that Athlon's performance message is getting out there and there's a strong demand for systems based on it, and OEMs are reacting to that demand."
For its part, HP downplayed the company's unannounced decision to add the Athlon to its Intel-dominated product line. "Really the choice of Athlon isn't any more in favor of performance than a Pentium III, it's just a pricing decision for these models," said Ray Aldrich, a spokesman for HP. HP would not comment on whether the PC maker would feature Athlon chips in any future products.
AMD also reported it grabbed a bigger slice of total processor sales by garnering 16.6 percent of the market, up from 12.6 percent the previous quarter and its highest level in a year. Intel's market share slipped from 83.7 percent in the third quarter to 82 percent for the final quarter of 1999.
Aside from overall strong demand for processors, AMD's return to profitability was also fueled by Athlon's strong showing in the more lucrative high-end consumer PC market. Before introducing the Athlon, AMD chips were mainly featured in low-end systems, where profit margins are much slimmer.
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